Asian equities rose with US index futures, while Malaysia’s ringgit trimmed its biggest three-month loss since 1997, as investors took stock after a quarter of volatile trading that wiped almost US$11 trillion (RM49 trillion) off the value of global shares.

The MSCI Asia Pacific Index pared set for a fifth straight monthly decline, the longest streak since the 2008 global financial crisis. US index futures climbed. Australia’s dollar advanced with the ringgit, as the Bloomberg JP Morgan Asia Dollar Index heads for its biggest quarterly drop in almost 17 years. Gold and Treasuries slipped.

“The stabilisation in risk sentiment looks relatively tentative to us,” Raiko Shareef, a markets strategist in Wellington at Bank of New Zealand Ltd, said in an email to clients. “We’d be wary of another deterioration in Asia today as funding costs spike in China ahead of a week-long holiday.”

The latest episode of equity selling was spurred by concern that mining and trading companies are being threatened by higher borrowing costs amid a prolonged bear market for commodities. That came amid the collapse in mainland China’s equity bubble, selloffs in US technology and biotechnology firms and an exodus from emerging-market assets as the world prepares for the Federal Reserve’s first interest-rate increase since 2006.

Chinese markets close for a five-day holiday from tomorrow, with the US payrolls report due later this week.

Stocks

MSCI’s Asia Pacific gauge rallied 1.1 percent by 11.17am in Tokyo, taking its loss since the end of June to 16 percent, the most since at least the third quarter of 2011. The last time the measure fell for five straight months was in the period to the end of November 2008, which included the collapse of Lehman Brothers Holdings Inc. MSCI’s All-Country World Index is down 11 percent since June 30, its steepest slump since 2011.

The Shanghai Composite Index’s 29 percent drop since June 30 is the worst performance of any major index globally this quarter. Hong Kong’s Hang Seng China Enterprises Index has the second-biggest drop. Investors have fled Chinese equities amid concern that valuations were still too rich and after the shock devaluation of the yuan on Aug 11 added to uncertainty around the strength of the world’s no 2 economy.

Japan’s Topix index jumped 2 percent yesterday from its lowest close since January. Australia’s S&P/ASX 200 Index rose 0.6 percent today, trimming its quarterly slump to 9.4 percent.

The Kospi index played catch up, losing 0.5 percent in Seoul as markets in South Korea traded for the first time this week. Taiwan is also back today after being shut due to a typhoon.

Futures on the Standard & Poor’s 500 Index added 0.4 percent, rising with contracts on the Dow Jones Industrial Average. The US benchmark reversed a drop of as much as 0.5 percent to end yesterday up 0.1 percent amid a rebound in the last 30 minutes.

Selling in biotech and technology stocks continued in the US, sending the Russell 2000 Index to its longest slump since 2006 and briefly pushing the Nasdaq Composite below its August close.

The Chicago Board Options Exchange Volatility Index, a gauge of expected US equity swings known as the VIX, pulled back yesterday, falling 2.9 percent after a three-day surge. The measure is still above the 26 level, compared with its average of 16.4 over the past 12 months.

A similar gauge for Japan - the Nikkei Stock Average Volatility Index - dropped about 5 percent, reducing its climb in the quarter to 50 percent, the most since the last quarter of 2014.

Currencies

With risk trades back in play for the last day of the quarter, the Aussie pared its worst quarter since the second three months of 2013, rising 0.3 percent as New Zealand’s dollar climbed 0.4 percent. Both currencies have lost more than 5 percent since the end of June.

The yen was little changed at 119.81 per dollar after rising 0.7 percent the past two days. Japan’s currency is best performer among major peers the past three months.

With Fed officials touting the prospect of a rate increase before the end of 2015, the Bloomberg Dollar Spot Index gained 2.8 percent this quarter. The gauge, which tracks the greenback against 10 major peers, was little changed today after falling 0.1 percent last session.

The Asia Dollar Index, which tracks the region’s 10 most- active currencies outside of Japan, has dropped 4.4 percent this quarter, in its worst performance since 1997. Malaysia’s ringgit led the rout with a 15 percent slide as oil prices retreated and Prime Minister Najib Abdul Razak was caught up in a corruption investigation. The ringgit halted a seven-day slump, rising 0.1 percent.

Gold for immediate delivery slipped 0.3 percent to US$1,124.48, its fourth straight drop. The metal is set for a fifth quarterly decline, which would be its worst run since 1997.

- Bloomberg